Goldman Sachs, the storied investment bank, plans on cutting up to 8% of its employees as it girds for a tougher environment next year, according to a person with knowledge of the situation.

The layoffs will impact every division of the bank and will likely happen in January, according to the person, who declined to be identified speaking about personnel decisions.

That’s ahead of an upcoming conference for Goldman shareholders in which management is expected to present performance targets. The New York-based investment bank typically pays bonuses in January, and it’s possible the layoffs could be a way to preserve bonus dollars for remaining employees.

Wall Street is adjusting to a lower revenue environment this year after a two-year boom in deals and hiring sputtered out. Goldman was the first major firm to cut jobs in September, a relatively shallow culling that only impacted a few hundred employees. That was followed by similarly modest cuts at Citigroup and Barclays, though Morgan Stanley cut about 1600 workers last week, CNBC was first to report.

But the upcoming move at Goldman is by far the deepest round of cuts on Wall Street so far. Other firms are likely to have to follow suit as a subdued capital markets environment drags on, according to Wall Street recruiter Mike Karp.

“Many firms will have to go back to the drawing board and right-size their organizations, it’s not just Goldman,” said Karp, CEO of the Options Group. “Firms over-hired, and now they will have to over-fire, too.”

The bank’s planning is ongoing through next month, and the round could be smaller than 8% when it is finalized, especially if people voluntarily leave, the person with knowledge of the situation added. But that means as many as about 4,000 employees could be impacted, as reported by Semafor earlier Friday.

Those who are considered underperformers or who are working in consumer businesses that are now being de-emphasized by the bank are at most risk of being terminated.

Goldman had been in hiring mode previously: the firm had 49,100 workers as of Sept. 30, which is 14% more than a year earlier.

Goldman CEO David Solomon indicated that he was looking to rein in expenses at a conference for financial firms last week.

“We continue to see headwinds on our expense lines, particularly in the near term,” Solomon said. “We’ve set in motion certain expense mitigation plans, but it will take some time to realize the benefits. Ultimately, we will remain nimble and we will size the firm to reflect the opportunity set.”